The Blame Game

The issue of who to
blame for the Gupta scandal is now being played out in full in South African
politics. The issue for Bell Pottinger is who knew what when.

In the April 2017
announcement that Bell Pottinger was quitting the Oakbay contract, Henderson
was robust, blaming negative comments on Twitter and saying that allegations
that the firm had worked to stoke racial tensions in South Africa were
‘completely untrue’.

However, the
allegations continued, fuelled by a report that was published in July when a
South African opposition politician referred Bell Pottinger to the Public
Relations and Communications Association (PRCA) and the Chartered Institute of
Public Relations.

Henderson responded
to the fallout by firing Geoghegan and suspending partner Nick Lambert and two junior team
members for ‘inappropriate and offensive’ activity.

He also hired law
firm Herbert Smith Freehills to investigate Bell Pottinger’s actions on the
Oakbay contract. It is believed that the law firm's initial report led to
Henderson’s decision to suspend and fire colleagues.

Issuing an
'unequivocal apology,' Henderson stated: 'We have already been shown interim
evidence which has dismayed us. Much of what has been alleged about our work
is, we believe, not true. But enough of it is to be of deep concern. These
activities should never have been undertaken.' One insider claims that ‘98 per
cent’ of the work was uncontroversial.

Henderson maintains,
however, that he was unaware of what his firm was doing on the Oakbay account,
insisting that he took no direct part in the Oakbay contract, never met or
communicated with the Guptas and devolved all responsibility for the contract
to his account team.

He claims that the
first time he knew of any problems was in March 2016 after Bell was rung by
Richemont chairman Johann Rupert, who said he had concerns about the Guptas.

'That was the first time Tim mentioned it,' says a Bell Pottinger insider.
'After that, Henderson knew about Richemont's concerns but he didn't know that
any of the other clients had an issue until they resigned.'

Henderson sent an
email to defecting clients, asking if they would reverse their decision if Bell
Pottinger gave up the Oakbay account. However, he was told it was too late.

This view points a
finger at Geoghegan, about whom Henderson had gushed that her 'energy,
commitment and broad range of skills embody what we want' when promoting her to
managing director of Bell Pottinger's financial and corporate division in
December 2016.

Geoghagen, who is
eight months pregnant, is said to have been horrified by vitriolic personal
attacks on her that have appeared online and on social media.

One South African
headline declared: 'From angel to pure evil: How UK PR Victoria Geoghagen got
her claws into South Africa.' Another called her a 'news prostitute'. A third
asked 'how evil mastermind Victoria Geoghegan sleeps at night'.

She is said to
believe that she has been unfairly made a scapegoat of the Guptagate affair and
is above all, a victim of the power struggle for Bell Pottinger between
Henderson and Lord Bell.

Bell has been openly
critical of Henderson, telling The Financial Times in July that Henderson ‘knew
all about it from the very beginning,' stating: 'The account was one of the
reasons I resigned from the company. The truth of it is self-evident. I told
them not to accept the client in the first place. They ignored that.'

Bell and Henderson also differ over the nature of Bell's departure, which is
said to have taken two years to negotiate.

'Tim didn't want to
leave,' discloses one source. ‘He was on £1 million a year as chairman but was
in the twilight of his career and wasn't seen to be bringing enough work in.'

Henderson and
Geoghegan both declined to be interviewed for this article while Bell did not
return calls.

Some industry figures
question Henderson’s oversight of the Oakbay contract. 'Alarm bells should have
rung at the management board level long before all this became so public,'
comments one.

'When one of your longest-serving clients calls you up and says they cannot
continue to work with you if you continue with a campaign, that should raise
concerns. There were lots of
warning signals received but Bell Pottinger continued to support the Gupta
brothers when it should have been asking whether it should be doing so.’

Henderson is said to
be exasperated by such criticism, believing that it was enough to have one of
his top operators in change. He feels that economic emancipation campaigns do
not have to be dark arts but can be done responsibly. He believes the problem
was that his team lost objectivity and perspective.

Does Bell Pottinger
have a future? Much will depend on the Herbert Smith report. Some senior PR
industry commentators believe Henderson will have to resign. The business may
be sold, though Henderson and his fiancée Heather Kerzner, an ex-wife of South
African casinos multi-millionaire Sol Kerzner, control 37 per cent of the
equity.

John Sunnucks, who
heads Bell Pottinger's financial services arm, has been reported to be mooting
a buyout attempt. Experienced management may also need to be brought into the
business to give it a fresh start, away from the problems of its legacy
management, although insiders claim that Hugh Taggart, the managing director of
Bell Pottinger’s 70 man practice Engage, is the frontrunner to take over. And
the ‘Bell’ part of the company’s name is expected to be ditched.

'Bell Pottinger will survive,' insists one believer.' But it will be in a
different form. It has to make radical changes.'

A more sceptical view is that this will be the end of an era. 'Bell Pottinger
is not just finished in Africa because of this; it is finished everywhere,' one
PR chief predicts. 'You can't expect to win new clients when you have just been
shown to have been working against your own clients. Nobody wants to join a PR
firm that does that.'

For now, the legacy
is that Bell Pottinger lost substantially more in terms of business and
reputation from the Gupta than it gained from the lucrative fees involved.

A company that made
its living for three decades from protecting the reputations of others failed
to safeguard its own.